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Oracle-Rimini Street Verdict Is A Milestone, But Far from the End

Oracle-Rimini Street Verdict Is A Milestone, But Far from the End

The long and winding legal saga between Oracle and Rimini Street over the latter's third-party software maintenance service reached a pivotal point this week with a Las Vegas jury's award of $50 million to Oracle.

However, the legal dispute between the companies is far from over, given the potential for an appeal as well as the existence of other legal actions between the companies. 
Nor did the judgment provide what many observers have been wanting for years: Clear-cut rules of engagement for providing third-party support in a legal manner.

That's not quite how Rimini Street sees things, though. “We were pleased to finally get our day in court," Rimini Street CEO Seth Ravin said in a statement. "As Oracle and Rimini Street agree, there is no dispute that third-party support for enterprise software is permitted for Oracle licensees to purchase and for Rimini Street to offer. This case was about a good-faith license dispute regarding processes no longer in use."  

Oracle's View 
I spoke with Oracle EVP and general counsel Dorian Daley in the wake of the verdict. She unsurprisingly had a different view of it than Rimini.

"The verdict is a validation of what we've been saying for years," Daley says. "Rimini's business model is based on massive copyright infringement and it has to stop. We are hopeful customers become aware of this, will reconsider and return to Oracle where we can provide them with excellent service."

I asked Daley whether Oracle agrees that customers have a right to purchase support from a third party, rather than only Oracle itself.

There are third-party support companies operating today that haven't fallen afoul of required laws and guidelines, Daley says.

Also, despite what press reports on the case would have you believe, it's not true that Oracle is waging a general war on third-party support, according to Daley. "Take a look at our record and our history," she says. "We do not file a lot of lawsuits but when our intellectual property is at stake, we do." 

Customers should be skeptical Rimini has truly changed its business model, Daley says. 

Oracle is now seeking an injunction against Rimini. This is a pointless pursuit, according to Rimini. 

"Once Rimini Street had the benefit of a judicial interpretation of disputed Oracle software license terms, we stopped all processes challenged by Oracle in this case and completed our transition to an all-remote support model in 2014," the company said in a statement. Therefore, Oracle’s request for injunction for processes no longer in use at Rimini Street is meaningless, as Rimini Street will explain in its forthcoming court filings.” 

The Bottom Line 

Oracle and Rimini's legal battle has gone on for more than five years and there is no end in sight, despite what you might read in the headlines, due to continued disagreement over the validity of Rimini's revamped processes.

Rimini has asked the court to declare that its current processes for PeopleSoft support do not infringe on Oracle's copyrights, something Oracle surely will fight against vigorously.

At the same time, that's an argument about process—not whether third-party support as a concept is legal. It certainly is, affirmed by arguments in this case as well as many conversations Constellation has had with legal experts. 

Customers need to assert their right to third-party support, however, since incumbents like Oracle certainly aren't going to champion the option.

"There really isn’t much incentive for on-premises software vendors to endorse third-party maintenance," says Constellation Research founder Ray Wang. "However, as a key part of Constellation’s Software Bill of Rights, it’s an option that customers should protect and demand of their vendor." 

Constellation believes that independent support (i.e. third party maintenance) is a key pillar of providing a win-win to customers and vendors, Wang adds. Customers should consider these options where possible regarding on-premises software when they are:

1. Considering contract negotiations on maintenance
2. Evaluating platform upgrades and cloud migration
3. Identifying cost savings to pay for future innovation

One of the benefits of on-premises software is that the customer still controls the software. Unlike the cloud, where customers “rent" their software in exchange for subscription pricing and faster innovation cycles, on-premises allows the customer to consider options such as independent support. As more customers move to the cloud, they will want to find some similar protections in order to avoid the impending cloud vendor lock-in that is already happening with some vendors, Wang says.

Tech Optimization Chief Executive Officer Chief Financial Officer Chief Information Officer Chief Procurement Officer

How cost management in the supply chain can lead to innovation

How cost management in the supply chain can lead to innovation

We have all heard the statement – you can’t cost cut your way to profitability. Too often in business, CxOs and others forget the spirit of this saying. Cost cutting, or more precisely, cost management, is vital to running your business. In many businesses and their associated supply chains, however, this is achieved in disjointed and siloed departments. This disjointed approach to cost cutting can achieve the basic goal of saving money and therefore “improving” the bottom line. But it falls short of long-term benefits for the businesses. Savvy CxOs need to look at cost through a different lens.

  • Determine the way costs impact the holistic picture of your business. Yes, I know that companies have to produce balance sheets, cash flow and income statements. But these exercises are driven on a quarterly and annual basis. What about the daily activity? When it comes to your supply chain, decisions about cost are made at a much more rapid pace. And their impacts need to be understood at the speed of business, not an accountant’s timetable. CxOs need to strive to get visibility into their costs at this level – not the level that is asked for by their accountants.
  • Understand how becoming more cost-efficient creates opportunities for new business models. Oftentimes when we speak with customers about some of their cost-cutting efforts, they emphasize the savings achieved. A worthy goal indeed, however, most CxOs do not promote or focus on the next level – what are the new business opportunities these efforts have created? Where can assets and resources be shifted because of efficiencies gained? If you can be more efficient in one area, where can you reinvest in others?
  • Change the mentality of cost cutting to waste management. I realize that this might appear to be one and the same. The distinction exists around the notion that waste management is a mentality that distinguishes between bad costs and good costs. It’s similar to when you go to your annual physical, and your doctor looks at both the good and bad cholesterol. Both numbers must be evaluated together, not in isolation. Adding cost is part of doing business but it must be done efficiently – cut waste not just blindly cutting spending.
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What does this change in mentality look like? Take for example the work SCA Technologies is doing with one of its customers, a fast-food giant. The Pittsburgh-based supply chain software firm has worked with this client toimplement technology that provides a level of understanding of costs previously not achievable. The outputs have been to understand the nuances in the fluctuations of commodity cost – poultry, eggs, beef, and cheese, to name a few. As a result, the fast-food giant gains a full view of the impact these costs have on their final product – throughout the end-to-end supply chain. Margin impacts, in turn, drive decisions around new product introduction, pricing and promotions. In a business where margins are constantly under pressure, this insight has deep impacts on the day-to-day business.

For example, the fast-food giant was looking to introduce a limited-time offer into its menu, but after assessing cost upticks for specific commodities required for that product, it became apparent that shifting to a more favorable time of year for those commodities would improve profitability. This level of insight into cost structures, and more important, how they impact the entire supply chain, enabled a smarter—and more financially sound—decision to be made.

We have seen the same in the consumer electronics business. For example, Apple understands the strategic advantage inherent in looking at the cost of items such as flash drives and taking a forward position. When Apple looks forward to new product introductions, it also looks to buy future production and inventory of key items – this is a massive cost creation. However, the assurance of being able to capture market share by having the right inventory on hand is vital. The issue of absorbing and adding costs is not the concern – identifying a possible business opportunity is the priority. They can do this because they have a holistic view of how near-term cost can impact long-term market share.

The bottom line for CxOs is that cost isn’t bad! Of course incurring costs for employee sushi lunches and paying for all your employees’ cell phone bills might not lead to the greatest business outcomes. Unless you are Google when you use these “perks” to ensure your minions are kept in the mothership as many hours as possible. But focus on those areas where waste management can open up avenues otherwise neglected. Look to cost as the basis for short-term and long-term innovation and laying the groundwork for new product introduction and new business processes.

 

Matrix Commerce Chief Information Officer

SAP Highlights S/4 Hana Finance, Cloud For Analytics

SAP Highlights S/4 Hana Finance, Cloud For Analytics

SAP Financial Excellence Forum offers a preview of TechEd announcements including S/4HANA Finance and SAP Cloud For Analytics. The finance app needs a lift from S/4Hana Logistics while Cloud For Planning is joining a suite.

Attendees at this week’s SAP Financial Excellence Forum 2015 at the company’s North America headquarters in Newtown Square, Pa., got a sneak peek at two announcements set for SAP TechEd next week in Las Vegas. In both cases, important financial apps will be part of a bigger story.

The first app in question, SAP Simple Finance, was the center of attention at the Financial Excellence Forum (#FinancialExcellence). The app itself is not new, but at TechEd, SAP is rolling out a new name, S/4HANA Finance. The “S/4HANA” naming scheme will extend to all of the suite’s coming, next-generation components, including an S/4HANA Logistics app that’s next in line for release.

@SAP, #FPA

The home page of SAP S/4HANA Finance (formerly known as SAP Simple Finance), surfaces notable key performance indicators available for drill-down analysis.

Simple Finance – sorry, S/4HANA Finance – was the subject of multiple vendor and customer presentations at the Financial Excellence Forum. SAP Exec Bob Jenkins, for example, talked up in-memory-powered, real-time analytics and responsive, user-friendly functionality. Demos highlighted modern Fiori user interfaces with type-ahead searching, real-time analytics, predictive capabilities and the in-memory-supported ability to drill-down to granular data for root-cause analysis.

Execs from SAP customers New York Life and Florida Crystals were on hand to highlight their S/4 Hana Finance deployments, and an executive from a $4 billion unit of GE talked about that organization’s proof-of-concept project on the app. New York Life’s Jon Feinstein said the insurer revamped its financial apps to gain better access to financial data that’s helping to drive faster, better decisions and better outcomes. The company went live on S/4HANA Finance in July and is now in the midst of its first quarterly close on the app.

Sugar manufacturer Florida Crystals became the first SAP customer to deploy Simple Finance early this year. The company’s enterprise architect, Sergio Nunez, said that despite a few rough edges in the early product, his firm was able to deploy the Simple Finance within eight weeks. It helped that the company was already on HANA, having been among the first to run ECC on HANA in the cloud back in 2013.

SAP Cloud For Analytics

The second, and bigger, bit of TechEd news previewed at the Financial Excellence Forum was the impending release of SAP Cloud For Analytics. A comprehensive suite built on the HANA Cloud Platform, SAP Cloud for Analytics will include components for BI, planning and, eventually, predictive analytics and GRC (Governance, Risk and Compliance).

In another name change, SAP’s previously available Cloud For Planning app is morphing to become the planning component of SAP Cloud For Analytics. Thus, Cloud For Planning is now, surprise, surprise, “SAP Cloud For Analytics For Planning.” As before, this planning app is aimed at the many line-of-business users outside of finance who need planning capabilities. Power users and those inside finance are much more likely to use SAP Integrated Business Planning for Finance, which is the vendor’s next-generation planning module for traditional ERP or S/4HANA deployments.

@SAP, #analytics, #planning

SAP Cloud for Planning is morphing to become the Planning component of SAP Cloud For Analytics.

SAP’s financial apps executives didn’t dwell on the other components of SAP Cloud For Analytics, but the BI and visualization capabilities will borrow from and replace SAP Lumira Cloud (while Lumira Desktop and Server will remain the on-premises products). Customers will subscribe to SAP Cloud For Analytics, paying base fees for each component (BI, Planning, Predictive, etc.) plus per-user subscription fees. I’m told there will be public-cloud multi-tenant services as well as private-cloud deployment options.

MyPOV On S/4 HANA Finance and SAP Cloud & Analytics

SAP says 25 customers are in production on S/4HANA Finance (Simple Finance), 275 more have projects in the works and that more than 1,000 have licensed the app. That’s not bad considering that the app wasn’t generally available until March, but that’s scratching the surface of the total SAP customer base.

Talking to customers at this week’s form, I get the sense that S/4 HANA Finance is a nice to have, promising improved productivity and a start on analytical decision support within finance department. But the bigger payoff in real-time analytics and money-saving business optimization will be opened up once S/4HANA Logistics and other modules become available. That’s when the finance team and others will start to be able to crunch really crucial business data in real time. To paraphrase one customer, S/4HANA Finance is the gravy while S/4HANA Logistics is the steak.

On SAP Cloud for Analytics, I really like the idea of an integrated, cloud-based suite combining not just reporting, visualization and predictive capabilities, but also planning and GRC. We’ve seen BI and planning together from Adaptive Insights and BI and Predictive from SAS and IBM, but this is a novel, expansive combination in the cloud. Having a consistent look and feel and promised ease of use across all these categories will be a breakthrough for SAP, which has to live down the BusinessObjects legacy of disparate tools and interfaces.

The “For Planning” component will be available immediately and the “For BI” component by year end. We’ll have to see how soon SAP follows through with the “For Prediction” and “For GRC” components of SAP Cloud for Analytics, as well as all the data-integration options customers will need to connect to on-premises and cloud-based data sources.


Data to Decisions Tech Optimization Chief Financial Officer Chief Information Officer Chief Supply Chain Officer

Forget the Cloud; Fog is Tech’s Future - says the Wall Street Journal - Organizing millions of IoT connections into Business Valuable Networks.

Forget the Cloud; Fog is Tech’s Future - says the Wall Street Journal - Organizing millions of IoT connections into Business Valuable Networks.

This WSJ article, in May 2014, was most certainly not advocating the end of the Cloud, but instead was highlighting the challenge of the ever-growing numbers of devices of all types connecting, and interacting, in a wholly different manner. The technology industry has come to realize that the Internet of Things is not just about sensors, it’s about the shift to millions and millions of devices interacting in new ways around events.

Research report now available: The Foundational Elements for the Internet of Things (IoT)

We are all too frequently aware of the poor responses caused by insufficient bandwidth, now bandwidth use, (over use), is multiplied by two dimensions; More traffic to centralized cloud based Data Centers for traditional heavy duty IT computational tasks; Plus and ever increasing number of small devices using connected service models.

The centralization of services into a lower number of ever larger cloud data centers might be desirable for the cost/scale needs of IT as we know it, but we need to recognize the rise of Internet of Things, IoT, also changes the game in terms of where, how and what resources are made available. Even more important to event centric nature of these new devices and their services is response times!

In the blog entitled; ‘We know things are changing, but what is making everything change? A summary of change factors in technology and business in 2015 – Part 1’; the root cause seen to be a global move in society, business and technology towards ever increasing de-centralization. Massive Data Center Clouds are doing an admirable job of delivering the centralized tasks of IT in a more efficient, effective manner, but it has become clear something different is required for mass numbers of small active devices. A different technology infrastructure and charging structure is needed to empower new de-centralization business activities; an infrastructure that unites Enterprises with their customers, and their increasing demands for personalization.

Fog Computing is an architecture that uses a collaborative multitude of end-user clients, or near-user, edge devices to carry out data storage, communication, control, and management tasks locally to improve responsiveness. Fog Computing is particularly suited to the kind of localized lightweight interactions around sensing and responding to an event that IoT, in its many forms, introduces.

This is an edited version of the Wikipedia definition of Fog Computing that gives a great deal more depth and correctly notes that the term and concept was first defined by Prof. Salvatore J. Stolfo a Professor of Computing at Columbia University, New York. However the name of Fog Computing is usually linked to Cisco following the better known publication of a white paper under this name by four Cisco Research staff in 2012, today the term Cisco Fog Computing is trademarked leading to a reluctance by some other technology vendors in using the term.

Though there may be reservations over the name Fog Computing due to its link to Cisco Marketing what is not in doubt is the almost total acceptance within the industry for the concept. Edge Clouds is a possible alternative name and at the end of this blog a list of papers on the topic, including some by major Technology, venders is included as a more detailed update. 

Edge Computing models are not new, as in every iteration of technology from mainframe onwards has faced the challenge of the amount of connectivity bandwidth available at the time, and the resulting latency affecting response times. However IoT Devices do bring a different dimension to this challenge being less about background computational transaction and more about visible on screen interactions for users. The increased dimension of user and event time significance warrants a different approach to what is meant by, and required as’cloud’ architecture. A more detailed explanation of the concepts of Fog Computing, (still the most popular term), or Edge Cloud Computing a more recent term, both defining the use of small localized clouds can be found in a previous blog in this series published in January 2015 entitled IOT: From the Intranet of Things to the Internet of Everything – Introducing the required solution architecture So why come back to the topic again only nine months later?

The level of engagement and activity related to developing Fog Computing across the entire technology sector has ramped up considerably as it becomes increasingly accepted that an edge-based architecture is an essential part of a mass Device or IOT environment. At the same time its become clear that the distributed ‘interactive’ IoT environment using Fog Computing supports still further innovation in technology capabilities around Data models and event processing.

To grasp the activity level and understand how Fog Computing and Edge Clouds is being developed there is at the end of this blog a list of links to papers and sites. Understanding the basics of the infrastructure architecture leads naturally to grasping two very important consequences that following blogs will outline;

De-centralized Business models require a de-centralized open infrastructure on which to develop their capabilities and innovative competitive propositions; these business models require access to, interaction with, and use of data in a wholly different manner to the conventions of assembling and analyzing data currently in use.

Resources

Research report now available: The Foundational Elements for the Internet of Things (IoT)

Some resources for Fog Computing or Edge Clouds information;

An HP white paper defining their views on Fog Computing

http://www.hpl.hp.com/techreports/2014/HPL-2014-60.htm

IBM explains their views on Fog Computing

https://www-304.ibm.com/connections/blogs/robertoa/entry/what_is_fog_computing?lang=en_us

Microsoft defining how its offerings match different Cloud/Fog requirements

https://technet.microsoft.com/en-us/magazine/ff394351.aspx

SAP team with Cisco to explain how they see the architecture developing

http://www.sapevent.ch/landingpagesfr/Manager/uploads/1525/Operations4.pdf

Central list of resources at Cisco for all Fog Computing matters

http://www.cisco.com/web/solutions/trends/iot/fog-computing.html

Ericsson provide an IOT telecoms view of Cloud Edge Computing

http://www.ericsson.com/research-blog/internet-of-things/edge-computing-in-iot/

The case for Smart Gateways to Operate Edge Cloud Computing architecture

http://www.datacenterknowledge.com/archives/2015/04/08/fog-computing-for-internet-of-things-needs-smarter-gateways/

A good briefing on Fog Computing by a startup product company

http://www.localgridtech.com/fog-computing-platform/

A new site campaigning to become the news site for Fog Computing

http://www.fogcomputingworld.com

 

Tech Optimization Chief Information Officer

Adobe Aligns New E-Sign Capabilities with Salesforce, Workday and Ariba

Adobe Aligns New E-Sign Capabilities with Salesforce, Workday and Ariba

Adobe has announced a series of enhancements to its Document Cloud's e-sign capabilities, but the most important aspect of the release for customers is an expanded partner program that integrates the product into Salesforce, Workday and SAP Ariba. From the release:

Workday—Speed business processes with e-signature capabilities pre-integrated into Workday’s built-in business process framework. The integration provides Workday customers that purchase Adobe eSign services with the ability to add e-signatures to over 400 business processes across the entire Workday application suite to help save time, reduce errors and legal risk, increase compliance, and improve employee experiences.

Salesforce—Simplify the setup, use and management of signature workflows for sales via the #1 customer-rated e-signature solution for Salesforce. The latest eSign services update delivers an easy-to-use setup wizard, automates common tasks like adding product lists to agreements, and supports certificate-based digital signatures. And, it’s native on the Salesforce Platform and fully certified with the Lightning app builder framework.

Ariba—Streamline the procurement process through greater flexibility, security and control when sending contracts for e-signature in Ariba Contract Management. The latest eSign services integration enables users to add multiple signers, define signing order, and verify signers with multi-factor authentication.

The release includes many new features of general interest to enterprises as well, such as support for the newer digital signature format that will be adopted across the EU next year, a new workflow designer, an improved mobile app, and automatic e-signature sync across mobile, web and the desktop.

The Bottom Line

Such features are welcome given the rapid growth in e-signatures around the world, but also to be expected as Adobe evolves its product. The most significant part of Adobe's announcement is the tie-ins to Workday, Salesforce and Ariba, says Constellation Research VP and principal analyst Alan Lepofsky

"Having digital signatures embedded into the business workflows that people use for HR, sales, marketing, finance and other processes eliminates the need to switch back and forth between multiple tools," Lepofsky says. "For example, a sales rep does not want to be working in Salesforce, then have to switch over to email and send a contract back and forth to get signatures. Having digital signatures embedded into processes helps drive adoption."

 

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Dell plans to acquire EMC, VMware, Virtustream, Pivotal and more

Dell plans to acquire EMC, VMware, Virtustream, Pivotal and more

This morning, not so much as a surprise after many leaks, it was made official – Dell plans to acquire EMC.  
 
 
Take a look at the thoughts my colleague Ray 'R' Wang and I put together this morning:

 

So let’s take a look at the press release (it can be found here) in our customary News Analysis style, and then let’s look at the implications:
 
Dell Inc. and EMC Corporation today announced they have signed a definitive agreement under which Dell, together with its owners, Michael S. Dell, founder, chairman and chief executive officer of Dell, MSD Partners and Silver Lake, the global leader in technology investing, will acquire EMC Corporation, while maintaining VMware as a publicly-traded company.
MyPOV – So we know who acquires who, MSD is the investment vehicle of Michael Dell and Silver Lake the partner that Dell used to take itself private. Keeping VMware (see latest blog on VMware, the VMworld event report here) as a separate company is key as we will see later. No word of other EMC federation members though, Pivotal (latest blog post here), RSA, VCE and Virtustream (the newest member of the EMC federation (see the Market Move blog on the acquisition by EMC here).
 
Under the terms of the agreement, EMC shareholders will receive $24.05 per share in cash in addition to tracking stock linked to a portion of EMC’s economic interest in the VMware business. Based on the estimated number of EMC shares outstanding at the close of the transaction, EMC shareholders are expected to receive approximately 0.111 shares of new tracking stock for each EMC share. Assuming, for illustrative purposes, a valuation for each share of tracking stock of $81.78, the intraday volume-weighted average price for VMware on Wednesday, October 7, 2015, EMC shareholders would receive a total combined consideration of $33.15 per EMC share and the total transaction would be valued at approximately $67 billion. The value of the tracking stock may vary from the market price of VMware given the different characteristics and rights of the two stocks.
MyPOV – An interesting vehicle to finance the deal, with VMware tracking stock. We leave it to our colleagues the financial analysts to look more in detail, but it is clear that the VMware stock prices is going to be in the spotlight in the next months. Interesting the announcement is featured on all other EMC federation members’ homepages, but not VMware’s.
 
The EMC Board of Directors approved the merger agreement and intends to recommend that stockholders of EMC approve the agreement.
MyPOV – Important detail…
 
DELIVERING FUTURE-READY TECHNOLOGIES TO CUSTOMERS
The combination of Dell and EMC will create the world’s largest privately-controlled, integrated technology company. The company will be a leader in the extremely attractive high-growth areas of the $2 trillion information technology market with complementary product portfolios, sales teams and R&D investment strategies. The transaction combines two of the world’s greatest technology franchises with leadership positions in servers, storage, virtualization and PCs and it brings together strong capabilities in the fastest growing areas of the industry, including digital transformation, software-defined data center, hybrid cloud, converged infrastructure, mobile and security.
MyPOV – Good point the largest privately controlled technology company. It will be interesting to see if and how Dell can use being private as its advantage. It has certainly show it here, as Dell, the smaller of the two vendors, can acquire EMC, the other way around would probably not have worked. And it is correct – both vendors combine a sizeable part of IT spend, for some customers we estimate north of 50%, for others in the low percentages (e.g. a VMware only customer). But it gives Dell what Dell wanted (and needed) – more access to the CIO office, and a larger portfolio to sell. Once you have that trusted relationship, you can use it to sell more and gain more share of wallet.
 
Since becoming a private company, Dell has had the flexibility and agility to focus completely on customers and invest for long-term results. The transaction will unite Dell’s strength with small business and mid-market customers with EMC’s strength with large enterprises to fuel profitable growth and generate significant cash flows. The combined company will consist of strategically-aligned businesses and incubated high-growth assets, fostering innovation, enabling customer choice and attracting and retaining world-class talent .
MyPOV – And here we have it stated – more CIO office access at larger corporations. True also that there are ‘incubated high growth assets’ (an interesting term) across both vendors, but both still have to show and live up to their growth potential. It is even harder to see that on the Dell side, but never vendor has created a 1B+ software product on the incubator side. Dell will needs a few of those to pull off in the future.
 
“The combination of Dell and EMC creates an enterprise solutions powerhouse bringing our customers industry leading innovation across their entire technology environment. Our new company will be exceptionally well-positioned for growth in the most strategic areas of next generation IT including digital transformation, software-defined data center, converged infrastructure, hybrid cloud, mobile and security,” said Mr. Dell. “Our investments in R&D and innovation along with our privately-controlled structure will give us unmatched scale, strength and flexibility, deepening our relationships with customers of all sizes. I am incredibly excited to partner with the EMC, VMware, Pivotal, VCE, RSA and Virtustream teams and am personally committed to the success of our new company, our customers and partners.”
MyPOV – Good quote from Dell, on the strategic areas he enumerates, we can follow on software defined data center, converged infrastructure (if e.g. Evo comes to Dell servers with force), mobile (Airwatch) and Security (RSA). We are more skeptical on digital transformation and hybrid cloud. On the former, because that involves also SaaS assets, that the combined entity will not have, and the latter as it requires to play in the public cloud, something that neither Dell nor EMC have done so far. Interesting Dell does not call out the EMC ‘bread and butter’ business… storage. Whatever that means for the storage plans we will see. If asked I am sure Dell will see storage as part of the software defined data center, where we are e.g. optimistic around the VMware Nicira assets.
 
“I’m tremendously proud of everything we’ve built at EMC – from humble beginnings as a Boston-based startup to a global, world-class technology company with an unyielding dedication to our customers,” said Joe Tucci, chairman and chief executive officer of EMC. “But the waves of change we now see in our industry are unprecedented and, to navigate this change, we must create a new company for a new era. I truly believe that the combination of EMC and Dell will prove to be a winning combination for our customers, employees, partners and shareholders.”
 MyPOV – An almost sentimental statement by Tucci, which also shows why EMC has not been able to pull it off so far in regards of strategic growth areas (which largely still remains a mystery to me – we will have to wait for the Tucci biography for a shot at this).
 
"We are excited and honored to invest in the outstanding businesses built by Joe Tucci and his world-class management team. This is an extraordinary opportunity to continue and expand our partnership with the iconic technology entrepreneur Michael Dell and his talented team,” said Egon Durban, managing partner of Silver Lake. “We believe the strategic integration of EMC and Dell will generate unparalleled depth and breadth across servers, storage, virtualization and the next era of converged infrastructure, creating a global technology platform poised for sustained long term growth and innovation in the years to come. We are doubling down and increasing our investment in this differentiated market leader for the next paradigm of enterprise computing.”
MyPOV Good quote from Durban, who (finally!) mentions storage, and the other parts of the data center play, servers and virtualization (but misses networking). And yes – Silver Lake is doubling down and betting on Dell to pull this off, ‘only’ the largest tech deal so far. In comparison, the tally for serial acquirer Oracle is around 50B over the last 10+ years.
 
VMware will remain a publicly-traded company and continue to provide customers’ value through leading software- defined data center technology, together with its cloud, mobile and desktop offerings. This transaction is expected to accelerate VMware’s growth across all of its businesses through significant synergies with Dell’s solutions and go-to-market channels. VMware remains committed to investing in and partnering with its strong, industry ecosystem.
MyPOV – And a key point on the independence of VMware again. Fair enough to say the independence of VMware allows for more freedom in partnering, but Dell competitors who are now VMware partners will not forget who owns VMware now… we will have to see if these may mean a move away from VMware in the medium run.
 
TRANSACTION TERMS
The transaction is expected to be financed through a combination of new common equity from Michael S. Dell, MSD Partners, Silver Lake and Temasek, the issuance of tracking stock, as well as new debt financing and cash on hand. There are no financing conditions to the closing of the transaction.

Mr. Dell and related stockholders will own approximately 70 percent of the company’s common equity, excluding the tracking stock, similar to their pre-transaction ownership.

MyPOV – No comments, here interesting that Singapore based Temasek got an in on the deal.
 
Following completion of the transaction, Mr. Dell will lead the combined company as chairman and chief executive officer. Mr. Tucci will continue as chairman and chief executive officer of EMC until the transaction closes. Dell’s headquarters will remain in Round Rock, Texas, and the headquarters of the combined enterprise systems business will be located in Hopkinton, Mass. […]
MyPOV – And that settles the leadership question, as well as when Tucci will resign. Interesting to see the common headquarter will be in Massachusetts, not the cheaper location to do business, but probably important to keep consistency. There seems to be a sentiment in Massachusetts on losing businesses and on the Q&A call it was clear that both Dell and Tucci were ready to address this concern.
 

Implications, Implications

Implications for Customers

As usual when acquisition happen, we recommend customers to make sure that key roadmap items are secured. Combined entities look for synergies, and those synergies may not be aligned with what enterprises have been promised before, or at least made their buying decisions on. Contracts are the weapon of choice to protect IT projects and enterprises from undesired outcomes. In more detail, storage customers should stay the course, unlikely they will see major disruption, but question converged appliances coming from EMC. It is likely that the next generation of appliances coming from the new Dell will be significantly better in price for performance. The VMware portfolio is unlikely to be affected, so stay the course. If building a next generation application projects, Pivotal is unlikely to be affected in the near term, too. Customers should not expect radical new and / or soon solutions to operate the public side of a hybrid cloud solution of the new Dell – as much as we would recommend the vendors to do so. So public cloud projects beyond the current EMC / VMware / Dell reach should stay the course, as project economics are unlikely to change substantially.

 

Implications for Dell

Rumors are out there that Dell tried to get rid of the consumer PC business before, if true it points to the fist challenge of a combined entity that is struggling to keep up growth on the consumer side. In the same industry HP is just separating B2C and B2B, one development to watch. If Dell can part from its onetime secret to success (cheap PCs), it will be an interesting step to observe. Dell has been able to grow its B2B server business to (estimated) 8B+, a respectable size, but not enough to reach the scale it needs. On the flipside, the Dell Server business is larger than the EMC Federation (excluding EMC) combined. Dell has also been working on a number of software assets, some of them acquired, some of them grown in-house, one of the more prominent ones the integration product formerly known as Boomi. One key area to watch will be, if Dell will embrace the latest VMware appliance, EVO. And the new Python offerings maybe interesting for a new way of running microservices and data centers. I expect the storage offerings to be merged quickly, for whoever remembers the bidding war between HP and Dell a few years ago around 3Par – this is an ironic step today. If the ‘new’ Dell will manage to integrate the technology stack it will be offering more products and services than arch rival HP and IBM, both are weaker in either functionality and or volume of the dimensions of the software defined data center game. From a breadth and depth only Oracle will be ahead of Dell, though clearly trailing on storage. Microsoft just launched its first PC, but we see the PC business as a side note in the overall considerations for the new Dell.

 

Implications for EMC

It will be interesting to see how long the EMC brand will keep being put on new products. Likely EMC is going into computing history as the ‘one trick pony’ that never made to make it beyond storage to be truly great. We expect the storage product to become part of Dell server combinations soon, everything else is not substantial to worry too long at this point.
 

Implications for EMC Federation companies

So let’s walk through them….

VMware remains the crown jewel in two aspects: For one to finance the deal – with immediate pressure on Gelsinger and team to keep the stock price up. And then for the intimate knowledge of knowing what enterprises run inside their data centers. When I asked Gelsinger why VMware is not doing more to monetize this, his reply was that VMware already is, to which mine was that we need to see more of that then. It will be that more that will make or break much of the success of the new Dell. If Dell can give VMware a homogenous on ramp to Dell owned datacenters, fortified with competitive SLAs, this will be an option CIOs and CTOs will look at with no doubt for the existing loads. If there are savings, why not run even complex load like e.g. SAP and Oracle solutions in the public cloud? As VMware is under pressure to keep up revenue we don’t expect any lower interest on the EUC portfolio. Invigorated by Windows 10, Airwatch and Horizon just have found a few thousand sales people with good CIO access. Monetizing this will be key for the success of the new Dell.

Pivotal remains a mixed story – shining on the PaaS side with CloudFoundry, not convincing on the database side. But even the latter may find new life when combined with the Dell ‘incubated’ products on the Big Data side. Though we remain skeptical, a struggling product family doesn’t get better when combined with a new incubated product family that isn’t fully developed. The story is very different on the PaaS side, where CloudFoundry remains almost the de facto standard for large enterprise PaaS projects. To give these next gen applications being built on CloudFoundry a public cloud home made by Dell is going to be key (instead of losing it largely to AWS and others). That this alignment of PaaS and IaaS works is something we see all over the market, from Oracle and IBM all the way even to Rackspace. Enterprises want to see less crack points and who can give them less integration headache will be a winner for tomorrow’s budgets.

Virtuestream is a short term opportunity – having done well with hosting / putting to the ‘cloud’ complex SAP ERP solutions. That is unique know how that should help the new Dell very well. In the long run though SAP will be better at hosting / putting to the cloud SAP than anyone else, so it is important for Dell to move fast in this regards, and again needs a target / public cloud where to run these loads.

RSA and VCE are beyond my coverage, so won’t mention them here.


 

Implications for partners

A great day for combined partners, which will get a lot of attention to power the new Dell. Watch for the portfolio cleanup and bet on the right horse early. As these things go, in case of doubt bet on the Dell product. Single vendor partners need to re-think their strategy if they want to try to be all in – but that will be a crowded boat, or if they want to seize the opportunity for a more heterogeneous portfolio. Some great partner enterprises have risen from the ashes of similar difficult scenarios.

 

Implications for competitors

We expect the competition to try to throw as much FUD against the new Dell as they can possibly create. All these markets are cut throat, Dell knows that. We expect competitors to offer migration offerings, with storage being the largest, and possibly even the most vulnerable target. Enterprises will keep looking for cheaper alternatives from open source vs e.g. VMware. But competitors should not bank on the uncertainty to last longer than two, maybe three quarters. Pressure on Dell to execute is massive, and that will lead to a clear roadmap and execution sooner than later.

 

Overall MyPOV

A very bold move by Dell, that is not even sure to go down as announced, pending financing and VMware stock value. Business goes on, e.g. VMworld Europe kicks off Tuesday this week and it will be a key event to reassure European customers of what VMware can do. Maybe Michael Dell will jet over there, which probably would be a key endorsement move and could slow some potential ‘Euro frenzy’. The industry has not done well with mega mergers, think of the HP / Compaq merger, but these are key events that are even being reviewed in the press 10+ years later. It will be the same for the Dell / EMC merger that – if Michael Dell and his (new) team can pull it off – will be a remarkable re-invention of the Dell brand, a very different Dell. It will be key to see if Dell can muster the investment to build out a Dell ‘public’ cloud for all the arguments we have listed earlier, that’s where in my view EMC missed the boat. And being later has never helped in the high tech business, but to catch up is getting harder and harder, so speed and execution will be of the essence. We will be watching.

 

 

 

Tech Optimization Innovation & Product-led Growth Next-Generation Customer Experience Data to Decisions Future of Work dell vmware AI ML Machine Learning LLMs Agentic AI Generative AI Analytics Automation B2B B2C CX EX Employee Experience HR HCM business Marketing SaaS PaaS IaaS Supply Chain Growth Cloud Digital Transformation Disruptive Technology eCommerce Enterprise IT Enterprise Acceleration Enterprise Software Next Gen Apps IoT Blockchain CRM ERP Leadership finance Customer Service Content Management Collaboration M&A Enterprise Service CCaaS UCaaS Chief Information Officer Chief Technology Officer Chief Digital Officer Chief Data Officer Chief Analytics Officer Chief Information Security Officer Chief Executive Officer Chief Operating Officer

I love APIs Event Preview

I love APIs Event Preview

We have the opportunity to attend the 'I love API' conference happening in San Jose this week on October 13th and 14th.

 

Take a peek at my thoughts here:

 
 
Or if you don't have a chance to look - read here:
  • APIs become more and more important - No surprise - APIs power more and more of the economy
  • Is is getting easier - or harder - One key area will be to see if it getting easier to build and consume APIs - not even by a developer, but potentially (a savvy) business users.
  • Do APIs scale? - It used to be that APIs could not do brute force interfaces - let's see how they scale up to the 21st century demands. And next to technical scalability, there is also business scalability with aspects like e.g. uptake, monetization, licensing and more.
  • IoT - No surrpise - the hottest next generation application use case features prominently at the conference. 
  • 3 Tracks - Developer, Technologist and Executive - will be interesting to see these three separate tracks. 
If you can make it to San Jose - make sure you step by and say Hello!
 
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If you like the video / blog - here are more event previews:
 
  • Event Preview - AWS reInvent 2015 - watch / read here
  • Event Preview - What I would like Salesforce to address this Dreamforce 2015 - watch / read here
  • Event Preview - What I would like Workday to address this Rising - read / watch here
  • Event Preview - What Alan Lepofsky and I want Box to address this BoxWorks - watch / read here
  • Event Preview - What I would like Salesforce to address this Dreamforce 2015 - read / watch here
Find more coverage on the Constellation Research website here and checkout my magazine on Flipboard and my YouTube channel here
 
 
Tech Optimization Innovation & Product-led Growth Next-Generation Customer Experience Data to Decisions Future of Work User Conference Chief Customer Officer Chief Information Officer Chief Marketing Officer Chief Digital Officer

IOT News: PTC to Acquire Augmented Reality Leader Vuforia from Qualcomm

IOT News: PTC to Acquire Augmented Reality Leader Vuforia from Qualcomm

Why is the PTC acquisition of Vuforia so important? PTC is is a global provider of technology platforms and solutions that transform how companies create, operate, and service the “things” in the Internet of Things (IoT). The company’s next-generation ThingWorx® technology platform gives developers the tools they need to capture, analyze, and capitalize on the vast amounts of data being generated by smart, connected products and systems. The purchase of Vuforia business from Qualcomm Connected Experiences, Inc., a subsidiary of Qualcomm Incorporated extends PTC’s strategy for digital and physical convergence. PTC is committed to continued growth of Vuforia Technology.

Who is Vuforia? Vuforia is one the industry’s most advanced and widely adopted augmented reality (AR) technology platform, and will enrich PTC’s technology portfolio and accelerate PTC’s strategy as a leading provider of technologies and solutions that blend the digital and physical worlds. The agreement says that PTC is committed to continued investment in the Vuforia platform and to the ongoing support and growth of the Vuforia ecosystem.

What’s Mobile Got To Do With It? Vuforia is a mobile vision platform that enables applications (“apps”) to see and connect the physical world with digital experiences that demand attention, drive engagement, and deliver value. Today, Vuforia is supported by a global ecosystem of developers in 130 countries, and has powered more than 20,000 apps with more than 200 million app installs worldwide.

It’s All About the Collaboration. The combination of Vuforia and PTC leverages two transformational technology trends – Internet of Things (IoT) and augmented reality (AR) – to deliver a new class of products that merge the digital and physical worlds. When coupled with PTC’s IoT and analytics platforms, Vuforia unlocks a world of possibilities for creating new ways to design products, to monitor and control products, and to instruct operators and technicians in the appropriate methods of use and service.

What’s Vuforia’s Got Going On? Vuforia has wide adoption from leading companies including 37 of the Interbrand 100 and has consistently been awarded for its performance, robustness, and ease of use, including “Best Tool” at Augmented World Expo in each of the last three years. Vuforia supports multiple developer tools, including Eclipse, xCode, and Unity and runs on multiple operating systems and devices, including iOS and Android phones, tablets, and selected mobile eyewear.

Why is This Partnership Important To Your Business? By delivering powerful computer vision functionality through a simple API, the Vuforia platform will enable developers and leading brands to deliver award-winning experiences to consumers around the globe. Vuforia has the ability to, through augmented reality, to transform work.

For more info, check out the press release.

@DrNatalie, VP and Principal Analyst, Constellation Research

IOT for Customer-Facing Applications that Change Marketing, Sales, Customer Service and Customer Experience in the World of Work

 

Next-Generation Customer Experience Chief Customer Officer

Dell to Buy EMC for $67 Billion: Five Initial Takeaways

Dell to Buy EMC for $67 Billion: Five Initial Takeaways

After weeks of speculation, Dell and EMC made history on Monday with the announcement of a $67 billion merger deal—the largest in tech history—which will see EMC go private under Dell's ownership. While a transaction of this size and scope will justifiably be scrutinized in depth over the coming weeks, here are some initial takeways for customers to consider.

It's All About VMWare

EMC owns an 81 percent stake in VMWare, which will remain a publicly-traded company after the deal closes. That said, VMWare and the enterprise workloads it runs in companies around the world are the "crown jewels" of the merger, says Constellation Research VP and principal analyst Holger Mueller.

Dell's aim is to transfer those loads to private and public data centers stuffed with Dell servers and software, along with EMC storage, VMWare Airwatch and other assets of the combined company.

"We know much of the future loads will run in the public cloud, so the new Dell has to find a way beyond being an OEM provider for the public clouds as put up by Telcos and others," Mueller adds. "No one knows better what loads enterprises run on-premises than VMware. When to move and transfer this load beyond on-premises data centers is the master plan."

A Pivotal Move

Dell CEO Michael Dell and EMC CEO Joe Tucci didn't talk much about software on Monday's conference calls for the deal. But software, specifically enterprise application development and delivery, could end up being a major growth engine for the combined company. "If executed right, Dell owns the majority of Pivotal, the most popular enterprise PaaS, and has a seat at the table for next-generation applications," Mueller says.

Open for Business?

Dell intends to continue partnerships such as VCE, the converged infrastructure venture between EMC, VMware and Cisco, and customers will have a wide set of choices," according to executives. Nor will Dell push VMWare exclusively as a virtualization platform, according to Michael Dell. Expect continuations of EMC's strong partnerships with the likes of Lenovo and Hewlett-Packard as well, executives said.

Paying for the Deal

Dell, along with Silver Lake Partners and MSD Partners, is taking on massive bank debt to acquire EMC. The plan is to significantly deleverage that debt over the next 18 to 24 months, in part due to "cost synergies," according to Silver Lake managing partner Egon Durban. While layoffs are expected, executives provided no specifics on Monday. 

Another way Dell could generate capital to pay down the debt would be through divestures of EMC product lines, with the VMware stake clearly being the most lucrative option.

The Bottom Line 

All of the sentiments and expectations about strategic synergies aside, this is a mega-merger that carries massive risk and uncertainty - as with any deal of such size. Dell and EMC customers should prepare for a long, complex integration process, as well as the potential for significant changes in their sales and support relationships with both companies. 

Customers at the beginning or middle stages of their public and private cloud journey will also be presented with a major new choice for a strategic provider. 

“Dell has a lot of free cash flow from the deal and has a once-in-a-life time opportunity to restructure its portfolio to compete not only in private cloud, but gain scale to compete with Amazon for cloud IaaS and PaaS," says Constellation Research founder Ray Wang.

For additional analysis, check out Mueller and Wang's Google Hangout discussion on the deal below.

 

 

Data to Decisions Tech Optimization Chief Executive Officer Chief Information Officer

Inside the SportsBiz Studio: Bob Hamer

Inside the SportsBiz Studio: Bob Hamer

1

Welcome to another edition of Inside the SportsBiz Studio! This is my version of Inside the Actor’s Studio where I will feature a Q&A with another sports business professional willing to share insights from their career and opinions about the state of the industry. Just like the TV show, there will be some common questions that everyone answers as well as questions tailored to each individual’s background in the industry.

BobHamer

Our next guest is Bob Hamer, President of Sports Business Solutions.

What was your first #sportsbiz job?

I was an intern with the Charlotte Bobcats & Sting during the Summer of 2005.

What was one lesson from that first job you still carry with you today?

The importance of learning and building relationships. We can always get better, and this industry is all about your network.

Who was a key mentor for you and how did they help?

My first boss Jeff Ianello. He gave me my first full time opportunity in Inside Sales at the Suns in 2006. He constantly pushed and challenged me to get better and it wasn’t always easy but he was always there when I needed help too. He saw something in me early on and continued giving me additional responsibilities and room to grow my career. I owe a lot of my professional success to him.

What sports brand or organization do you hold in the highest regard and why?

It’s hard to pick one and I have a lot of teams I’m close to that I really respect, but I’d say in general the NBA and its family of teams. What they do with their TMBO (Team Marketing and Business Operations) consulting group and how they share best practices to elevate the performance of all of the teams is very impressive and something I’ve always admired.

What is one industry trend you are closely monitoring over the next 12 months?

Social selling and sports sales 2.0. The game is changing and I’m eager to see how teams utilize data and technology to be more efficient in their sales processes.

What one professional accomplishment are you most proud of today?

Becoming a Vice President in the NBA. I never could have imagined it in my wildest dreams. And to do it all in Phoenix with the Suns, a team I loved working for in a market I loved living in was really special. There aren’t many examples of someone starting in Inside Sales and ending up as a VP with the same team, I’m very proud of that.

In your time at the Suns, how did you see the landscape of ticket sales change?

Data & technology. Getting smarter about our pricing (variable and dynamic), more information on our customers, sourcing our sales and focusing our efforts where we saw the greatest return. In general, operating the business more strategically. We’ve come a long way from the phone book!

Everyone is focused on how millennials are different as both customers and employees. How do you see this affecting the industry?

I think it’s exciting! They bring a knowledge of digital and social media that I think is vital long term. They want to know the why behind what we do and want continual coaching, training and development, all of which will help create a more engaged work force that’s developing constantly. It’s a more fluid work environment which keeps it new and fresh, I think that’s all very positive. In terms of customers, people will always love sports and entertainment, and they’ll see business value in being a partner with sports teams so I don’t think it’ll change too much there.

What is one underrated skill that you look for when recruiting new talent?

Ambition. I want to find people that want to be the best at what they do and are willing to put in the time and energy necessary to do so. We can teach and train you but we can’t teach the intangibles like hard work and passion.

What can candidates do to make themselves stand out better, from their resume all the way to the interview?

Go beyond just applying for the job. Be proactive, develop relationships with people in the organization, get connected through a mutual contact. If you’re referred over to a hiring manager for a job you’re much more likely to get an interview than applying cold. Don’t play the waiting game, go out and get it.

You can connect with Bob on LinkedIn or on Twitter at @SportsBizBob.